Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/52769
Authors: 
Bandyopadhyay, Sanghamitra
Year of Publication: 
2003
Series/Report no.: 
WIDER Discussion Papers // World Institute for Development Economics (UNU-WIDER) 2003/77
Abstract: 
This paper documents the convergence of incomes across Indian states over the period 1965 to 1998. It departs from traditional analyses of convergence by tracking the evolution of the entire income distribution, instead of standard regression and time series analyses. The findings reveal twin-peaks dynamics—the existence of two income convergence clubs, one at 50 per cent, another at 125 per cent of the national average income. Income disparities across states seem to have declined over the 1960s, only to increase over the subsequent three decades. The observed polarization is strongly explained by the disparate distribution of infrastructure, and that of education, and to an extent by a number of macroeconomic indicators; that of capital expenditure and fiscal deficits.
Subjects: 
convergence clubs
conditional convergence
distribution dynamics
infrastructure
capital investment
macroeconomic stability
panel data
India
JEL: 
C23
E62
O53
Document Type: 
Working Paper

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